Strategy to use HELOC then repay from 401k after age 59-1/2 & student graduation.

Are you basing this plan on just the FAFSA EFC?

A school that meets need will base aid on the CSS profile and that most likely will look at your home equity as well.

If the second child attends a public OOS school, don’t expect them to give (more) aid when there are two in college.